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Charts & Analysis

Just Three Sectors Have Propped Up the Market in 2013

You don’t know how tough this market is until you’ve seen the carnage in the stuff that is not the Nifty. First,the broad Indexes this year:

Nifty, Junior, Midcaps and Smallcaps in 2013

While the Nifty looks really good and just 2.5% off the number that it closed on Dec 31, 2012, look at how badly the other set have done. Nifty Junior is the set of 50 stocks AFTER the top 50 – still very good stocks, just beyond the top 50. This is down nearly 10% for the year.

Midcaps – embodied by the Nifty Midcap 50 index – are not very large in market capitalization, and contains stocks like Bata, Tata Global, Punj Lloyd etc. This has fallen over 23% in 2013.

Smallcaps as an index contains many mid-caps as well. That one is –28% this year. The worst hit, by all measures.

And then, a look at the sectors:

Sector Comparison 2013

The 2013 story is just about three sectors:

  • IT (+28%)
      • FMCG (+18%)
      • Pharma (+17%)

Every other sector has underperformed the Nifty, and some by a huge margin. Metals is the worst, shaving more than 41% off this year. Stocks like Hindalco and Tata Steel have been hit hard.

Real estate stocks are digging themselves all the way to Canada. Banks, after looking good in April-May, have hurt big time in the last month, down over 18% for the year.

The Nifty’s being propped up by the defensives and IT exporters, and the stock market is being propped up by the Nifty. Everything else seems to have been bitchslapped out of existence.

  • Gold Bug says:

    We are definitely in a period of “stagflation”. In Stagflation following assets classes performs well;
    1. Pharma, FMCG, IT(purely foreign exchage play)
    2. Liquid Funds (having around 90 day maturity profile)
    3. Real Estate (all weather asset class in India)

  • Jose says:

    This is one reason why retail investors are so scared to enter the markets..Its good to be in Fixed Deposit with a 9 -10 % Yield that take risk and see your portfolio diminish. There is this stats that approx 230 people control the Indian market on any given day contributing to 78 % of total volumes..so we know how shallow it is. With yields set to shoot up globally & India, we must see 11.5 % Yields back again with $ 65 – 68 by Sept/Oct.